THE man at the helm of Grand Central Railway said he was surprised at the demise of National Express East Coast and suggested small is beautiful when it comes to connecting with rail travellers.

In an interview with The Northern Echo, managing director Tom Clift said that despite continuing criticism of the franchise system, which many critics say led to National Express walking away, “inevitably there would be more franchises”.

However, he believed there was also scope for more open-access operators, such as Grand Central, to run rail services to more routes, and to survive as it does as a commercial venture with no financial link to the Government.

Major rail operators are franchised by the Government, meaning they receive a subsidy, while also having to provide hefty payments to the Treasury for the privilege of running services.

National Express, which had run the East Coast franchise, refused to fund the route beyond the end of last year after buckling under the financial demands placed on it. It was replaced by a publicly-operated company in November.

The Government plans to hand the franchise to another private operator from the end of next year.

Referring to the East Coast franchise failure – the second after GNER also gave up the route because of financial difficulties – Mr Clift said: “I was a bit surprised by lightning striking twice in this way.

“The thing is, it depends how desperate you are to win [a franchise]. If you are too desperate, sometimes you get your figures wrong.”

Explaining the contrast between franchised operators and open access, Mr Clift said there was evidence to suggest that the latter were more focused on customers than their larger counterparts.

He said: “The top two companies in the country in terms of passenger satisfaction are both open-access operators – Grand Central is one – so what does that tell you?

“The larger you get as an organisation, the more distant you seem to get from the end customer.”

Mr Clift said Grand Central, based in York, regarded itself as the longest community railway in the UK and had proved that it could deliver new and innovative services without relying on the public purse.

He said: “The community and the people who use us think of us as their local railway, which just happens to go to London.”

Grand Central, which recently celebrated its second anniversary, operates four services a day from Sunderland to King’s Cross, in London. Bosses hope to learn soon whether it will receive a four-year extension to its agreement to run trains, which expires in 2012.

The company is planning to invest £7m in more reliable and environmentally friendly engines for its trains, along with other improvements, should it get the go-ahead.

Mr Clift said: “We should get an answer by mid- February and we are confident it will be the right answer.

“This will enable us to put brand new engines of the latest specification into our power cars.

“We are also looking at further enhancements to heating and air conditioning on our trains.”

Mr Clift said the company had, over the past several months, regularly exceeded its target of having 85 per cent of its trains running on time. He said: “Modifications to our trains will improve times even more, but that will take time.”

Unlike several other companies, Grand Central has frozen its ticket prices until at least May.

Asked about whether it could raise prices after that, Mr Clift said no decision had yet been taken, although he said the firm was solely reliant on fares for its income.

He said the company’s North-East route, on which 1,400 passenger journeys are made daily, was now making money after breaking even last year.

Mr Clift said: “We have made steady progress on a number of fronts, but there are still things we want to do better.”

■ Grand Central recently suggested it could take legal action over a new timetable being planned on the East Coast Main Line from May next year, which it said could lead to longer journey times on its services.